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The United States Federal Trade Commission has renewed its antitrust lawsuit against Facebook, arguing that the social media giant is an illegal monopoly and that it should be forced to sell Instagram and WhatsApp.
The FTC initially filed an antitrust complaint against Facebook in December 2020, but that case was dismissed in June 2021 by a federal judge who ruled that prosecutors had failed to prove that Facebook was an illegal monopoly in the industry. social networks.
The original lawsuit, however, was dismissed “without prejudice,” meaning the FTC would be allowed to file a new lawsuit against Facebook, and that’s exactly what the federal agency did this week.
In the retrial, the FTC accuses Facebook of turning to an illegal purchase or landfill program to maintain its dominance after repeatedly failing to create innovative mobile features for its own social network. Additionally, Facebook has worked to kill startups when they were identified as threats to Facebook, says the FTC.
“It illegally acquired innovative competitors with popular mobile features that have succeeded where Facebook’s own offerings have collapsed or have collapsed,” says the FTC. “And to further stifle its monopoly, Facebook lured app developers to the platform, watched them for signs of success, and then buried them when they became competitive threats.
“Without serious competition, Facebook has been able to refine an advertising model based on surveillance and impose increasingly heavy loads on its users. “
Instagram was launched in 2010 and has seen tremendous growth before being acquired by Facebook for $ 1 billion less than two years later. The WhatsApp mobile messaging app was acquired by Facebook in 2014.
“Facebook lacked the business acumen and technical talent to survive the transition to mobile,” said Holly Vedova, acting director of the FTC’s Competition Bureau. “After failing to compete with the new innovators, Facebook illegally bought or buried them when their popularity became an existential threat.
“This behavior is no less anti-competitive than if Facebook had bribed emerging app competitors to be uncompetitive. Antitrust laws were enacted to prevent precisely this type of illegal activity by monopolies.
“Facebook’s actions have suppressed innovation and product quality improvements. And they degraded the social media experience, subjecting users to lower levels of privacy and data protection and more intrusive advertisements. “
While Instagram is undoubtedly a leader in social media photo sharing and hugely lucrative for major influencers, its evolution under Facebook has been controversial, especially among photographers. Instagram’s newsfeed went from chronological to algorithmic in 2016 (which makes it more similar to Facebook’s newsfeed), and Instagram director Adam Mosseri sparked an uproar in July 2021 when ‘he said that’ Instagram is no longer a photo sharing app ‘.
The FTC is now asking the court to force Facebook to sell Instagram, WhatsApp and possibly other businesses it has acquired. He is also asking the court to ban Facebook from making similar acquisitions in the future.
If the FTC succeeds, it would be the first court-ordered antitrust disbandment in the United States since AT&T disbanded under President Reagan in the 1980s.
“The FTC’s action today is aimed at ending this illegal activity and restoring competition to the benefit of Americans and honest businesses,” the FTC said.
Facebook responded to the new FTC case by calling it “without merit”.
“It is unfortunate that despite the court dismissing the complaint and finding it to be unfounded, the FTC has chosen to pursue this unfounded lawsuit,” Facebook said. “There was no valid claim that Facebook was a monopoly – and that hasn’t changed. Our Instagram and WhatsApp acquisitions were reviewed and authorized many years ago, and our platform policies were legal.
“The FTC’s allegations are an effort to rewrite antitrust laws and overturn established expectations of merger review, telling the business community that no sale is ever final.
“We fight for people’s time and attention every day, and we will continue to vigorously defend our business. “
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